Getting a good interest rate on a savings account is what many Canadians want to do. However, there are things other than the interest rate that you need to consider as well.
For those who want a safe and convenient way of getting their money to grow, a savings account is one way to do it. One of the most common complaints from banking clients was that normal savings accounts offered by banks paid little interest and only gave a respectable percentage for those who kept high amount of money in their account, typically over $50,000. However, things are changing as of late and more financial institutions are now offering a high interest savings account to their customers.
According to a recent report published by Bank Review, interest rates for high interest savings accounts varied between 1.50% and 2.10% for accounts offered by some of Canada’s leading financial institutions. Clients should know, however, that interest rates paid on a high interest savings account are usually variable, meaning that they can change at any moment. Standard protections for deposits still apply, meaning that deposits are insured as per the rules of the CDIC, so there is no risk that the client’s account diminishes in value, regardless of market conditions.
Financial industry reviewers are urging those interested in opening a high interest savings account to also consider any fees, service charges or restrictions that the financial institutions may impose. For example, some banks would require a minimum opening balance and have charges for withdrawals or transfers. But due to increased competition in the industry, many financial institutions have now done away with minimum balance requirements and charge relatively low fees when the client makes a withdrawal or transfers money out of their savings account.
Even though savings accounts are one way to help people save and grow their money, they are not the only method. Investors who are less averse to risk and are looking for some higher performing investment vehicles may want to take a look at some of Canada’s mining stocks, for example.
There are plenty of companies which are exploiting Canada’s oil sands and whose stocks may be of interest to certain kinds of investors. However, proper research is necessary to find a stock that will be in line with an investor’s goals and current portfolio. Speaking with an expert, such as a personal financial advisor is recommended for those who would like to find suitable types of investments. An advisor can take a look at any individual’s situation and see what kind of investment products would be most appropriate. This could include risk free or low risk investments such as guaranteed investment certificates, high interest savings accounts or money market funds. For those who want to participate in the stock market, the advisor can also recommend certain kinds of stocks, as well as put together a strategy that will help the client achieve their investment goals.